Cases of Interest

Sheridan v Pact Group: Medical incapacity is not a shortcut to dismissal

• Summary

  • Ms Sheridan worked for Pact Group as a community support worker in a challenging residential care environment.

  • Following a workplace incident in January 2021, where a resident threatened to slit her throat, she developed PTS

    D and went on sick leave.

  • Pact Group initially raised disciplinary concerns about how she handled the incident, but the matter then shifted toward medical incapacity.

  • The employer repeatedly asked Ms Sheridan for information about when she could return to work, even though she was waiting for ACC and specialist input.

  • Pact Group dismissed her for medical incapacity after about six months.

  • The Court found the dismissal unjustified.

  • Pact Group was a large national organisation and had more options available to manage operational pressure than simply dismissing her.

  • The Court criticised Pact Group for failing to properly engage with rehabilitation, failing to wait for relevant ACC information, and failing to apply its own rehabilitation policy.

  • Ms Sheridan was awarded $30,000 compensation for humiliation, loss of dignity and injury to feelings, plus lost wages.
    

• Lesson learned

  • Employers do not have to keep a role open forever, but they do have to act fairly, patiently, and intelligently.

  • Where the medical incapacity arises from a workplace incident, the employer’s obligations are heavier.

  • A fair employer should ask: Can we rehabilitate? Can we adjust duties? Can we use temporary cover? Can we wait for medical information?

  • Dismissal should be the last step, not the administrative tidy-up.

  • For employees, the lesson is clear: if you are being pressured while waiting for medical or ACC information, that pressure may itself be legally significant.

  • Medical incapacity dismissals are fact-sensitive. Employers who rush them invite trouble.

  • The blunt lesson: you cannot injure someone at work, ignore rehabilitation, then complain that their recovery is inconvenient.
    

Faitala and Vea v Pacific Island Business Development Trust: Redundancy must be genuine, fair, and culturally coherent

• Summary

  • Mr Faitala and Mrs Vea were senior employees of the Pacific Island Business Development Trust.

  • Their roles were disestablished during a restructuring process in 2023.

  • The Employment Relations Authority had already found their dismissals unjustified, but the employees challenged parts of the outcome, including remedies and the failure to uphold separate disadvantage grievances.

  • The Employment Court found serious procedural defects in the redundancy process.

  • The Trust failed to provide relevant information, failed to meaningfully answer questions, failed to properly consider redeployment, and failed to follow through on commitments made during consultation.

  • Importantly, the Court also found that the Trust failed to comply with Pasifika values that were incorporated into the employment relationship.

  • The Trust’s own documentation emphasised values such as respect, family, community, reciprocity, religion and spirituality.

  • The Court held that those values were not decoration. They mattered.

  • The failure to conduct the restructure consistently with those values unjustifiably disadvantaged the employees.

  • Mr Faitala received increased remedies, including six months’ lost remuneration and $30,000 compensation.

  • Mrs Vea received 12 months’ lost remuneration and $45,000 compensation, reflecting the greater impact on her.
    

• Lesson learned

  • Redundancy is not magic dust. An employer cannot simply say “restructure” and avoid scrutiny.

  • A fair redundancy process requires real consultation, disclosure of relevant information, meaningful consideration of feedback, and genuine exploration of redeployment.

  • If an employment agreement incorporates cultural values, those values may become legally meaningful.

  • Employers who brand themselves around culture, community, and respect must actually behave that way when the relationship becomes difficult.

  • For employees, the lesson is powerful: procedural unfairness is not limited to cold technical breaches.

  • A process can be legally unfair because it ignores the human, cultural, and relational framework the employer itself promised to honour.

  • The blunt lesson: values in an employment agreement are not wall art.
    

Harte v MERAS: Even a union can breach good faith

• Summary

  • Ms Harte was a self-employed midwife and a union member.

  • She sought support from her union, MERAS, during workplace difficulties involving Te Whatu Ora.

  • The same union official who had supported Ms Harte later supported another union member in matters adverse to Ms Harte’s interests.

  • The union failed to manage the conflict of interest properly.

  • It also failed to tell Ms Harte what had happened.

  • The Court found that the union acted against Ms Harte’s interests and undermined her employment relationship.

  • The union official later sent a letter to the employer raising serious concerns about Ms Harte, including vague allegations of bullying, laziness, poor role modelling and intimidation.

  • The Court found the allegations lacked specifics and had not been properly checked.

  • The Court accepted that the breaches were deliberate, serious, sustained, and damaging.

  • It found that Ms Harte had been let down by an organisation she was entitled to trust.

  • The union was ordered to pay a $12,000 penalty, with the whole amount payable to Ms Harte.

  • The Court also awarded $38,000 compensatory damages under its equity and good conscience jurisdiction.
    

• Lesson learned

  • Good faith is not just an employer’s obligation.

  • Unions also owe duties to their members.

  • Where a union is advising or representing a member, it must manage conflicts of interest carefully.

  • It cannot quietly switch sides, use information gained from one member, or advance vague allegations without checking them.

  • This case is especially useful because many employees assume their only possible opponent is the employer.

  • That is not always true.

  • Representatives, unions, and advocates can cause real harm if they mishandle trust, confidentiality, and conflicts.

  • For unions, the lesson is severe: internal politics and divided loyalties do not excuse bad process.

  • For members, the lesson is empowering: if the people meant to protect you undermine you instead, the law may still have something to say.